Using the jig and Dremel to cut the hole worked OK, but the resulting hole was a slight oval due to the peak of the deck.
Initially, I was going to use a center disc of cedar cut from the deck but this proved not to work very well. Instead I used a piece of walnut to fill the center. Thin strips of walnut were also used to fill the gap around the outside of the carving as the hole in the deck was cut slightly oversize. This was done on purpose since the carved disc did not perfectly match the deck hole. If left as shown in the above photo, the imperfections would have been very obvious. Instead, I removed material in order to make a fairly even gap all the way around. As it is, it now looks like a design feature of a contrasting walnut border edging the carving, which goes well with the walnut center.
The carving was glued into place, supported from underneath by temporary supports (ie sticks) hot-glued to the underside of the deck. The edges were eased and the carving gently sanded along with the rest of the deck in preparation for fiberglass. The carving received a pre-coat of epoxy in order to fill in some of the relief of the carving and then was glassed along with the rest of the deck. During the fiberglass wet-out, some bubbles were still trapped in the relief but their effect was minor. Prior to the fiberglassing the underside of the deck, the bottom of the carving was planed & sanded flush with the rest of the deck. Two or three extra layers of 4 ounce glass cloth were applied to the underside of the carving and the immediate area just to strengthen & protect this spot. The end result was an inlaid carving that is slightly raised above the deck but cannot even be felt from underneath.
In the above photo, the carving along with the rest of the deck has been fiberglassed and the fiberglass sanded to a dull finish. The photos below were taken after another fill coat of epoxy was applied to the deck.
Finally, below is the finished product, dubbed the "engagement kayak."